The effects of tone at the top and coordination with external auditors on internal auditors' fraud risk assessments

Isabel Wang, Neil Fargher

Research output: Contribution to journalArticle

7 Citations (Scopus)

Abstract

Prior research suggests that internal auditors’ judgements are subject to management influence resulting in compromised risk assessments. This study investigates the effects of the tone at the top and coordination with external auditors on internal auditors’ fraud risk assessments. Results of an experiment involving 64 internal auditors indicate that when the tone at the top is poor, rather than favouring management, internal auditors report a higher risk of intentional misstatements and that coordination with external auditors can further reduce expectations of the incidence of intentional misstatements.
Original languageEnglish
Pages (from-to)1-26
JournalAccounting and Finance
DOIs
Publication statusE-pub ahead of print - 21 Dec 2015

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